Dubai, Sept. 20, 2006 (WAM) -- Dubai Financial Market (DFM) has signed a Memorandum of Understanding (MoU) with Pakistan's Central Depository Company (CDC).
As per the MoU, DFM?s Depository, Clearing and Settlement (CDS) Department and CDC will issue, market and promote securities for trading in the UAE and Pakistan. In addition to that, CDS and CDC will consult with each other if any issuer intends to appoint either of them as a sub-depository.
CDS and CDC will work closely, help and facilitate each other and provide support in different areas including new product lines, IT infrastructure, personnel development, software development, investor awareness programmes and operational support.
Essa Kazim, Director General of DFM, said: The MoU is a landmark agreement between UAE and Pakistan's stock markets and economies. The MoU heralds a new era wherein securities investors will have hassle-free access to the markets. CDS and CDC will be able to exchange knowledge, ideas and best-practices and offer best in class services to issuers in a most secure environment. The agreement will enable CDS and CDC to enhance security levels and safety for issuers as it will create a transparent system for exchanging information. This will be beneficial for DFM as we anticipate higher growth in volume of cross-border trading,he added.
Dr. Qaiser Anis, President of Pakistan Business Council UAE (PBC) said: ?With the signing of the MOU, gates are now open for listed companies in Pakistan to register in Dubai Financial Market. Hopefully, several companies will be applying to register on the DFM and vice versa. This will give opportunities to invest in listed Pakistani companies by UAE nationals, non-resident Pakistanis and financial institutions through DFM.CDC will facilitate the UAE investors to access the Pakistan Stock exchanges for trading in stock markets which bodes well for both the countries. Pakistan's trade with UAE is developing but investments have taken the lead and the UAE has now emerged as a single largest source of FDI in Pakistan contributing to more than US$ 1.5 billion out of a total FDI of around US$ 3.8 billion for the year 2005-2006, he added. Dr. S. Qaiser concluded: Foreign investment in Pakistan?s stock market have more than doubled to $351.5 million (about AED 1,278 million) until June this year, from $152.6 million (about AED 554.9 million) a year earlier, according to the State Bank of Pakistan. With the MoU between the CDC and DFM's CDS, we now hope that UAE will also emerge as a big player in this arena too. CDS Department is one of the most important pillars of Dubai Financial Market. Through it an atmosphere of confidence, security and stability is provided to the investor, through the confidentiality of information pertaining to the investor and his property. The CDS Department safe-keeps the securities listed in the market on the one hand, and through the administration, safe custody , registration, depositing, and transfer of ownership of securities either immediately as a result of sale and purchase transactions in the market, or transfers outside the dealing room operations, on the other. This is in addition to the settlement of the prices of securities traded in the market by settlement and liquidation of the net amount payable and collection from licensed brokers through the accredited Settlement Bank.
